First PERM BALCA Decision

The following article discusses the salient issues raised by the first PERM BALCA decision, In the Matter of HealthAmerica, No. 2006-PER-00001 (BALCA, Jul. 18, 2006).
The American Immigration Lawyers Association (AILA) and the American Council on International Personnel (ACIP) jointly filed an amicus brief on this case. Having had the pleasure of working closely with Josie Gonzalez and the rest of the AILA-ACIP amicus team in drafting the amicus brief, I can say that we were all pleased at how far-reaching the BALCA decision was (changed 08/17/06 Ed.)

Background

The Board of Alien Labor Certification Appeals (BALCA, or "the Board") ruled in the employer's favor on this first appeal of a PERM denial. The Board found that the Certifying Officer (CO) abused his discretion in denying the application based on a non-material typographical error where the employer, in its motion to reopen, was able to present clear evidence that was in existence at the time the application was filed demonstrating that it was in full compliance with the relevant law. Though the direct impact of this decision is limited, it establishes a significant precedent for future cases, namely, that the record in a PERM case includes the materials the employer must retain pursuant to the regulation's recordkeeping provisions. In addition, the Board confirmed that the U.S. Department of Labor (DOL) acted inappropriately in seeking to impose a substantive rule of law by means of a Frequently Asked Questions (FAQ) document on its website rather than through the formal rulemaking process.

Facts of the Case

This case involved an employer who filed a Form ETA 9089 Application for Permanent Employment Certification under the PERM program administered by the DOL. The application was for a professional position that required the employer to attest to having placed two print advertisements on two different Sundays in the newspaper of general circulation in the area of intended employment.

The petitioning employer's PERM application was denied due to a typographical error that inadvertently indicated that the second of its two required Sunday ads was actually run on a Monday. The facts of the case indicate that the application was automatically denied by the PERM program's electronic decision software without full review by an officer. The employer filed a motion to reopen/reconsider the decision, and included the original newspaper tear sheet in support of its motion. The tear sheet conclusively demonstrated that the second ad had, in fact, run on a Sunday.

Nonetheless, the CO denied the motion on the ground that the regulations do not permit the submission of "evidence not previously submitted" with a motion to reconsider/reopen, and that the tear sheet constituted such new evidence. Referring to the fifth of the PERM Frequently Asked Questions (FAQ) documents that the DOL has posted on its website, the CO also stated that corrections can only be made to a PERM application when an error has been made by the DOL; when the petitioner makes an error, the only remedy is to file a new application with the appropriate corrections. However, in this case, simply re-filing was not an option for the employer since by the time it received the CO's initial denial, several months had passed and the prevailing wage determination had expired. Accordingly, the employer elected to appeal.

In the amicus brief we argued - among other things - that it was inappropriate to consider a tear sheet to be new evidence when the PERM process does not permit the submission of supporting evidence up front with the application. Rather, we suggested that the documentation the regulations require the employer to keep on file for five years should be considered part of the administrative record, and not be considered new evidence for purposes of an appeal. We also asserted that the DOL's reliance in its denial on its PERM FAQ No. 5 for the proposition that on a motion to reopen the CO can only correct an error made by the DOL (but not an error made by a petitioner) was an abuse of discretion.

BALCA'S Holding

BALCA ruled in the employer's favor on all major issues, as set out below.

The Parameters of the Administrative Record

The key holding has to do with what constitutes "evidence not previously submitted" for purposes of a motion to reconsider under 20 CFR 656.24(g)(2). BALCA agreed with amici's argument that all of the documentation that the employer is required to keep on file for five years and that exists at the time the application is filed should constructively be considered to have been "previously submitted." Specifically, the Board held that "documentation 'submitted' in support of a labor certification application constructively includes the materials held by the employer under the recordkeeping provisions of PERM." This is significant for a number of reasons, not the least of which is that otherwise the CO essentially can control what constitutes the administrative record depending on whether or not the case is audited.

Harmless Error

The PERM regulations do not contain any harmless error provision. Nevertheless, the BALCA decision sets a limited but significant precedent with regard to non-material typographical errors. As the Board made clear, "[t]he CO's denial of the application based on the typographical error found in the Form 9089 elevates form over substance."

The precedent is limited, however, as the Board specifically stated that its ruling was limited "to the precise circumstances of this specific case." Moreover, in a footnote, the Board criticized the DOL for the fact that its "electronic submission process included no checks to warn the Employer that the dates used on the application would result in an automatic denial." However, it also noted that if the computerized application system had provided the employer with some kind of immediate feedback warning about of the error, the Board may not have found it an abuse of discretion to have denied reconsideration in this case, even with the presentation of the tear sheets as evidence.

Thus, if DOL upgrades its software to include some kind of pop-up warning related to this or other questions on the form, a petitioner who makes a mistake may not have any grounds for appeal. Nonetheless, appeals related to typographical errors on other parts of the form may prove successful (depending on the question involved) based on this precedent, assuming they are even subject to denial in the first place.

FAQs Do Not Have the Force of Law

The other key holding has to do with DOL's reliance on an FAQ in its denial of the petitioner's motion for reconsideration. The CO's denial was predicated on its FAQ #5 which provides that corrections cannot be made to an application after submission. The Board found the CO's reliance on this FAQ to be a denial of due process. In so finding, the Board clearly reiterated a key legal concept, namely, that an agency cannot impose a substantive rule of law by means of an FAQ, but must go through the formal rulemaking (notice and comment) process.

"The CO's policy not to consider mistakes made by employers is arbitrary and capricious and not supported by any regulatory language, regulatory history or decisional law," the Board wrote. It held that "FAQ No. 5 imposes substantive rules not found in the PERM regulations, nor supported by PERM's regulatory history, nor consistent with notions of fundamental fairness and procedural due process." This holding can potentially have an enormous impact on the PERM program going forward since there are a number of other areas where substantive rules are being imposed through the FAQ process.

Remands

We also argued in the amicus brief that, because the DOL's PERM regulations do not provide that BALCA can remand a PERM application to the CO, its only remedy in this case was to certify the application. In a reply brief, DOL argued that because an application like this one - which was automatically rejected by the computer - has not undergone thorough review by the CO, the employer's application could not be granted until the CO had the opportunity to review it more closely. DOL jumped through a number of rhetorical hoops in an effort to claim that what they were asking for was not a remand.

BALCA disagreed with our argument, but only on the narrow grounds presented in this particular case. While noting that "[t]he CO's argument puts a unique gloss on the meaning of the term 'remand'" and reserving further examination of the remand issue for future cases, the Board interpreted the CO's argument solely as a concession that the Board may return a PERM application for further processing under the specific circumstances presented by this case. Accordingly, in this case - where full processing had not been completed - BALCA vacated the denial and returned the application to the CO to complete processing.

Looking Ahead

In a letter dated August 2, 2006 and addressed to the BALCA Chairman, the DOL's Office of the Solicitor stated that the Certifying Officers have carefully reviewed the Board's decision in HealthAmerica and have concluded that no purpose would be served in filing briefs in the cases that were being held in abeyance pending the Board's decision in that case. The letter goes on to state that "[w]hile there are, potentially, significant factual differences between at least some of these cases and the facts in HealthAmerica, we believe that how those distinctions actually impact the adjudication of a particular case is more appropriately dealt with by the Certifying Officers in a new determinations [sic]."

The HealthAmerica case itself has already been certified, and many if not all of the cases that BALCA had been holding in abeyance can be expected to be certified in the near future. Going forward, it is to be hoped that motions to reopen cases denied based on harmless, typographical errors will be granted, so that appeals will not be required. Finally, to the extent that this decision compels DOL to upgrade its computerized decision matrix to avoid these types of denials in the first place - and/or to warn users of obvious errors and give them an opportunity to fix them before filing the application - the number of unnecessary denials should decrease.

About The Author

Careen B. Shannon is of Counsel to the law firm of Fragomen, Del Rey, Bernsen & Loewy, LLP, the world's largest law firm concentrating exclusively in corporate immigration law. A frequent writer and speaker on immigration law issues, she is also an Adjunct Professor of Immigration Law at Yeshiva University's Benjamin N. Cardozo School of Law. She will be one of the featured speakers at the September 17, 2006 session of ILW.COM's three-part seminar, "PERM Practice Here and Now."

The opinions expressed in this article do not necessarily reflect the opinion of ILW.COM.